Facing up to the reality of energy, ecology and economy

Forget the three Rs. Lets talk about the three Es: energy, ecology and economy. All three are serious issues facing America and its citizens and businesses, and each is something the metals industry needs to take to heart in a frank way.

Several otherwise unrelated articles in this months issue highlight just how much this is the case on a regular basis these days. This issue is filled with stories about EPA regulations, proposed tougher local clean air and water guidelines, issues around opportunities and pitfalls in the OCTG market, the need for stronger and lighter metals in automobile manufacturing, and numerous views on where the metals economy is heading.

Often overlooked is how much the three Es are interlinked. While not always nor exclusively locked in a symbiotic relationship, it often is the case that energy, ecology and economy are dependent on one another. The businesses that most successfully understand and incorporate this thinking are the ones that will rule future markets.

Because it is grounded in science, technology and engineering, the metals industry is uniquely positioned to lead the country in discussing ways to find new solutions that can power people and industry, keep the environment safe and put strong winds at the sails of the American economy.

Two recent examples of attempts to engage in this discussion are the current policy agendas of the American Iron and Steel Institute (AISI) and the Specialty Steel Industry of North America (SSINA). Each plan includes statements on working with the government to formulate reasonable regulation and problem-solving. These advocacy organizations should be praised for their attempts if the statements are sincereand if the discussions are engaged in honestly and rationally. Such work can be the way forward.

Despite efforts like these, metals businesses often try to deny the truth and scope of these challenges. It is easier to find ways to justify the status quo than it is to face reality and begin to adapt to the facts and adopt new ways of performing. But a long view of the history of business shows this is unwise. Those companies willing to accept the truth and change their ways survive best and flourish. Beyond this battle for economic relevance, there are moral and ethical imperatives to citizens, communities, workers, owners, shareholders, future generations and the planet.

How we use energy, how much it costs and where it comes from affect both the ecology and the economy; issues about ecological well-being have a strong impact on energy policy and economic directions; and the economy drives the responses to the needs of both energy and ecology.

Energy is a problem that is not going to go away, no matter how much we try to ignore the fact that deep and fundamental changes are required in American consumption, expectations, attitudes and business. Our current approach to energy leaves resources open to scarcity, the environment often deeply wounded and even the nations defenses stretched and challenged. We need to move with force and will toward alternative energy sources, more fuel-efficient vehicles and a sane and responsible national energy policy.

Ecology is an issue that demands respect and response. The stakes are just too high for all of us and the children, grandchildren and generations beyond we are responsible for. Bad or wrong decisions create suffering and damage now, and will lead to the future suffering of untold millions. That is a heavy responsibility, but one we should feel privileged to have. Again, reasoned response should lead to governmental regulations and changes in business operations that can work for everyone involved. To believe otherwise is just to delay the inevitable anyway.

The economy is a challenge that perhaps sometimes blinds business leaders to these other realities. But an admission that the three Es are interconnected will open new paths of thinking. Yes, todays profit is important, but so is tomorrows. So every decisions short-term gain must be weighed against potential long-term risks and benefits. Changing energy and ecology will alter the economy; there is no getting around that. But when necessary, change needs to be embraced and nurtured, and smart, fresh answers are needed to solve difficult challenges.

Yet the metals industry is not always leading the way; in fact, by fighting certain changes it sometimes is inhibiting the progress required. That must cease to be.

What lies at the heart of this inability to move forward are battles over whether science is showing us a true picture of just how bad our energy and ecology problems are. There was a time when American culture valued science for its ability to show us, if not what was true (with a capital T), then at least what was real, no matter how unpleasant the news. But now, depending on our personal, business or political interests, science has become something to denigrate, to discredit, even to demonize.

That must stop. It may be a winning short-term strategy for some industries and businesses, but it is a lousy long-term investment, not only in the ability to make, market and sell products, but also in the welfare of the nation as a whole. And for the metals sector especiallytied as strongly as it is to scienceit is a shameful display of immediate gratification over long-term interests.

John Ambrosia

Magazine editor

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